Three companies to control 60% of world’s seed and pesticide markets.
By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET.
German drug and agrichemicals giant Bayer has suffered a setback in its efforts to acquire the world’s biggest seed company, Monsanto. Bayer had reckoned on winning regulatory approval for its $63.5 billion takeover bid at the beginning of this year, but this week the company cautioned that it could take longer than expected to receive final clearance from EU regulators.
The corporate marriage between Bayer and Monsanto has already received the blessing of more than half the 30 antitrust authorities that need to sign off on the acquisition, including those in the US and Brazil. If given the go-ahead by the European Commission, this mega-merger would create the world’s largest supplier of seeds and farm chemicals.
Bayer’s interest in Monsanto is reflective of a trend that began decades ago but picked up speed in 2015: the increasing concentration of power and control over the global food chain. US giants Dow and DuPont were the first to tie the knot. Their merger, completed in 2017, resulted in a combined seed-and-pesticide unit that, in terms of annual sales, is roughly the size of its biggest current rival, Monsanto.
In the last two years, Chinese chemical giant ChemChina has bought up Swiss pesticide-and-seed player Syngenta; and fertilizer giants Agrium and Potash Corp of Saskatchewan have merged into a new mega-player called Nutrien.
This gathering process of oligopolization is happening at virtually all levels of the global food industry, including on the buy side — companies that purchase farmers’ crops and process them into livestock feed, food ingredients, and biofuel, as well as serve as the intermediary in grain export markets. But it’s the concentration of power and ownership in the global seed industry that should be the biggest cause of concern, since seeds are the primary link of the global food chain.
In 2016, just six American and European companies – Monsanto, Dupont, Syngenta, Dow, Bayer, and BASF – controlled 100% of the genetically modified seeds planted around the world. Those six are now five. If Bayer’s bid for Monsanto is successful, they will become four.
This trend has massive implications for both the choice and price of the food people consume. Seeds, which for millennia have been a common good to be shared out and improved among small communities of farmers, are increasingly becoming the preserve of a tiny handful of companies. As Mother Jones reports, by reducing the number of players in these markets, the mergers dilute the competition for farmers’ business, handing price leverage to the remaining players:
If Bayer-Monsanto goes through,… three companies will control around 60 percent of the globe’s seed and pesticide markets. A 2016 study by Texas A&M researchers found that a successful Monsanto-Bayer merger would increase seed prices for US farmers by around 2 percent for corn and soybean seeds and by 20 percent for cotton seeds.
The tie-up still faces a number of obstacles. Bayer would need to raise a large amount of debt and/or equity financing in order to acquire Monsanto. Last week the German drugs maker reported lower than expected fourth-quarter earnings after group profits were hit by pesticide pricing pressures in Brazil. The firm’s shares dropped 3.4% on the news, hitting their lowest point in almost 15 months.
The merger also poses a reputational risk for Bayer. Monsanto remains the world’s most despised company and as such could be more of a curse than a blessing. Monsanto is also weighed down by debt of its own, which it raised to fund its $10 billion share buyback program to prop up its own shares.
There’s also growing public opposition to the deal across Europe. Results from a YouGuv survey conducted in Germany, France, Spain, Denmark and the UK reveal that the merger gives 47% of EU citizens “serious” or “very serious” cause for concern, while just 11% think the merger offers any potential. The respondents worried that that the merger would negatively impact the environment, the amount of chemical substances used in farming to control pests and weeds, and farmers’ choices of what crops they would be able to farm.
Over one million Europeans have so far signed petitions calling on the European Commission to block it, and have been joined by more than 200 civil society organisations, from farm workers to international development groups. WeMove.eu, which organized the petition, calls it the “merger from hell.”
The Competition Commission is scheduled to make a final decision on the matter before the end of June. Considering that Europe’s immensely powerful biotech lobby has infiltrated just about every relevant regulatory and policy body in Brussels, the chances of the Commission derailing a deal of this size and strategic importance are slim.
Brussels gave its seal of approval to the Dow-Dupont and ChemChina-Syngenta tie-ups in 2017 with barely a blink of the eye. In November 2017 a wafer-thin majority of EU governments voted to extend the European license for glyphosate, despite fierce public opposition to the continued use of the highly controversial chemical.
The deciding vote was cast by Germany’s caretaker government. As Le Monde noted wryly at the time, it’s often forgotten that Germany, famed for its anti-nuclear activism and passionate environmentalism, is also, “a paradise for pesticides manufacturers.” Given the amount of money — and power — at stake, regulators will likely not get in the way of the biggest pesticide manufacturer buying the world’s biggest seed manufacturer, to create the world’s biggest agricultural company with enormous amounts of control over the global food supply. By Don Quijones.
Construction & services giant Carillion collapsed even as KPMG signed off on its financial statements; now they deny any responsibility. Read… “It’s Not only Carillion that’s Built on Sand, it’s our Whole System of Corporate Accountability”
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We never seem to learn, even with the example of what happened with the oil company consolidation. Where is the FTC? ;-(
Gutted under Regan, blindfolded, stood up and shot by Trump.
“We” never seem to learn . . . that government is not the answer to our problems.
Food Will Be Scarce
For thousands of years, the world human population has been 1.5 – 2 billion people. Then 200 years ago came the industrial revolution and the advent of the internal combustion engine. Powered by coal and steam at first, then by petroleum.
This enabled the farmer to feed many more people and the worlds human population has exploded to 8 billion souls in just the past 200 years.
The earth by 2050 will be home to as many as 10 billion people. The planet must produce more food in the next four decades, than all farmers in history have harvested over the past 8,000 years.
To prevent large scale and wide spread starvation, agricultural intensification must include increasing yields while decreasing the amount of land, water, and energy used to grow food.
I don’t hold out much hope, considering the human propensity to selfishly think only locally and for themselves.
I don’t think humanity will reach 10 billion, and if it does, it won’t be for very long … too many possible ‘interventions’ that could nock things down a bit, be it climate induced, war (conventional and/or nuclear), biologic (either by nature’s hand or mankind’s .. or again, both !) Throw in the continued destruction of eco-systems/habitat, caused by the outright elimination thereof, or through the indiscriminate use/abuse of chemical agents/wastes, then there is no reason, for me anyway, to think exponential human pop. numbers can rise much higher, unless ‘we’ can get Elon and Co. to tera-form Mars, or collonize Europa .. and in a hurry .. !! Na gonna happen … so down we spiral, into the ditch of history …. with, of course, the additional help of the Giants of Corpulent Ag to give us a less than gental push !!!
If you research into that topic the best way to accomplish this in terms of resource use, land use, water use, crop use, would be to get everyone to go vegan (plant based).
The amount of land, water, crops that ANIMAL AGRICULTURE uses is so ungodly it should be illegal.
I hope that this merger is not permitted to happen. This is straying away from the topic, but it needs to be said. So here I go:
Everything that grows does not require agricultural chemicals and genetic modification. There are side-effects and unintended consequences of these seeds and associated products that will be need to be dealt with for decades and possibly centuries to come.
Farmers and agri-businesses are being led into the corner with genetically modified seeds that require ever larger doses of pesticides and herbicides. Not to mention the monoculture problem that is coming into existence all over the world with these crops. And when it comes to food, diversity is a necessity, not an option. Just read up on the potato famine in Ireland for an idea of what happens when a monoculture food source collapses.
And this leads directly to the bees. I have been watching this happen for the last 5 years on the East Coast.
Honeybees are disappearing more every year, and without these little guys, fruit, tree nut, and vegetable farming will not be possible as we know it today.
This is everyone’s problem and if it becomes a food chain collapse problem, the 8-9 billion people on this rock will quickly and violently become a tiny fraction of that number.
As a gardener for more that 50 years, (yes, I am a dinosaur.) These are frightening developments.
Looks like capitalism will solve overpopulation for us.
With all the evidence of glyphosate destroying male fertility and causing cancer, it’s the height of evil that it should be not brought up in this merger.
For thousands of years, the world human population has been 1.5 – 2 billion people.
If you mean 1.5 people to 2 billion people then you are right.
But if you mean 1.5 billion people, we might have crossed that line 100-150 years ago, not thousands of years ago.
Who keeps buying Monsanto seeds? And why?
Other corporations? Because they share Monsanto’s outlook on life?
For example they have Round- Up Resistant strains where you can apply Round- Up weed killer without killing crops. These seeds originally weren’t terminator type.
So you could use seeds from yr crop fr next yr.
Monsanto made you register yr field I believe because you weren’t supposed to do this.
But then in next door fields some seeds would float over on wind and those farmers told M to get lost. M lost in courts.
So M came out with terminator seeds that won’t produce seeds themselves.
The short answer is they buy M seeds to make money.
PS : Round-Up is now off patent and same stuff Clear Path is cheaper.
Grow your own food whenever possible is my advice Boycott their poison food
My wife is at “Seedy Saturday” today. It happens once per year where several hundred people get together and trade their excess seeds. Getting away from these squid conglomerates is a motivating force.
We grow almost all of our vegetables except for some fresh but poor stuff we purchase at a local grocery store Dec-March. Our own green houses are just starting to sprout salad greens and we’re +50 deg north. Most of our protein is wild fish and our own eggs.
Screw Monsanto. There is a reserved place in hell for them.
I’d really like to see people get more into growing food rather than lawns. Here you can grow all kinds of things year-round. Collards, green onions, basil, arugula, raspberries, you name it. People seem to have an all-or-nothing attitude. “We can’t grow enough to feed ourselves here” so why bother doing it at all. But you can add a lot of nice veggies to your diet. If allowed, keeping chickens is fun and you get good eggs.
Where do you live? I must move there.
In a gloabalist world where Chinese companies aren’t constrained by anything, how can we say this is a bad deal? The reason we have a Eurozone is to create an economic block to compete with China and the USA..
The fact is, Monsanto is a lot more than a seed company. My daughters division, Climate Control, does everything from soil testing to economics.
We went through this with oil. We went after “big oil”. Today, Exxon is the 5th biggest conpany and frankly, isn’t even a serious player against Perto China and CNOOC.
This fantasy that we can have global free trade and 10 million small businesses is about as realistic as the Epcot center.
You either get rid of the China trade or let the deal go through.
Yes, this is a point I have been investigating for some time. I think in more complex (technical?) businesses: Agribiz, Petrochem, Pharma, Electronics, (others/autos?, materials processing/refining- steel, Al, mining), there are enormous economies of scale and international trading required to compete. So, these tend to get to the oligopoly (monopoly) end of things.
Other items, like retail distribution, maybe not.
It’s an interesting economics issue.
When are they basically monopolies? utilities? quasi-government?…this needs to be understood in order to get the rules of the road right.
Knowing the academics and government economists, they’ll get it wrong.
$ad that all the hoopla over the nra doesn t extend to Big Ag, PhArma, big Finance / TBTF and TBTJ mega-banks..Cable / Internet access co’s, Health Insur providers,,,the list is long….it s funny to still meet people who think their govt, or one of the political parties is going to look out for their interests…kinda like having a conversation with a kid who believes in $anta Claus.
Wait until Bernie gets done with selling you socialism.
It’s too bad it doesn’t extend to the Medical Industrial Complex, who spends more than 100 times what the gun lobby does, and is the number 3 leading cause of deaths in America. (Number 2, if you adjust for known undereporting).
As usual… people worrying about what media tells them to worry about are worrying about the wrong things
It’s a mistake to allow this kind of consolidation. It destroys competition, which is what makes capitalism work in the first place. The world seems to be marching toward oligopoly and oligarchy.
It’s not just consumers but also employees who suffer in these situations. Feel underpaid and underappreciated? So what. There’s nowhere to go and possibly they won’t hire you because they’ve secretly agreed with your bosses not to poach.
Capitalism stopped working decades ago.
It did a pretty good job on the computer you are commenting with.
All the basic components in your computer are the result of government lab work or government sponsored/subsidized lab work. Try again.
The chip that began the micro computer revolution that pried the computer AWAY from big business and government was the Intel 6502. The first app was just the hand- held calculator.
It was a bunch of teen- age hobbyists who began using it to build what could be called a computer. No government presence or interest whatsoever. The Home Brew club had a member called Bill Gates. His first semi- serious job happened when a small hobby outfit called Altair had a computer kit.
Prob was you typed your instructions in the only language the chip worked with directly: machine language or binary: a string of zeros and ones.
So Altair requested a translator program that would accept inputs from the BASIC language.
When Gates and gang showed up at Altair the secretary thought they were the kids of the real techs who had slipped by her into the meeting.
When Gates typed 2+2 and 4 popped up the execs smiled. No one had seen the machine do anything before.
Later he would be hired to write DOS for IBM’s first micro-computer. Then the big outfit lost interest and GAVE him the program.
The other key NGO was Apple. An very early Apple was dropped off a re-cycling depot a few months ago. It is built on plywood with wires running all over and at the center a 6502 chip. The logo ‘Apple’ is hand lettered on the plywood.
It sold for well over a hundred thousand dollars.
The micro-computer revolution began and was nurtured purely by (then) very small- time inventors.
I know first hand about the Sith Lord Monsanto. I had a 600 acre farm in south Texas. Monsanto is the enemy of small farmers. Just try to grow your own seed corn. They force you to buy sterile seeds only from them. That’s just one complaint about our commercial ag overlords
Look up the terminator seed (god help us if that got out )or how if a farmer growing their crop from Monsanto seeds happen to pollinate your field half a mile away. You get sued by Monsanto for patent infringement
The only thing these corps like to grow is their bottom line
Don’t forget about the neonicotinoids an insecticide resembling nicotine that Monsanto uses to coat their seeds. The plants absorb the neonicotinoids and they are present in pollen and nectar making them toxic to bees. This has caused the bee populations to decline.
I read about this in a Popular Mechanics from the late 30s: Neo-nicotinoids were invented because it was expensive to grow actual nicotine. So they’re older than most think.
There are ways to grow nicotine that are probably cheaper than growing tobacco; there’s a Russian weed tobacco called makhorka that’s got a lot more nicotine in it. And smoking’s down so think of the poor tobacco farmers.
But yeah, terminator genes in seeds etc have all been talked about for a decade at least. I lived on a “survivalist compound” to learn permaculture which is farming without the help of big corp’s and I learned a fair amount. Ate awfully well, too. The big corp’s don’t want farmers growing their own seeds, fixing their own tractors, etc. I wish more people knew about this.
Years from now, when Monsanto is finally sued out of existence, it’ll be cold comfort if the bees are already dead. The fact that these pesticides have not been banned is an embarrassing victory of money over science.
What’s the word for ignorance cultivated by cupidity? There should be a word for it.
Your local Lowes sells probably 100 pallets of Roundup a year to suburban homeowners. If it’s so bad, where are all the dead bodies?
The suburbs are literally soaked in chemicals. weed killers, bug killers, mouse killers. Where are all the dead dogs?
America is turning into a nation of 9 year olds who are afraid of their own shadows. Grown men and women take vacations to Disney. They dress their pets up in doll clothes and talk to them like they’re babies. The top 10 grossing movies last year were effectively cartoons.
I think I;m going to market a grown up pacifier. People can use it when their imported plastic girlfriends turn them down for sex.
You can’t see cancer when driving down a suburban street. Why do you even expect so see it? Why do you expect to see “dead bodies” in the streets as the only credible evidence that a chemical might have negative health consequences when ingested?
Your local Lowes sells probably 100 pallets of Roundup a year to suburban homeowners. If it’s so bad, where are all the dead bodies?
In the morgues. Glyphosate is a carcinogen and a cumulative poison. It’s insidious, and takes it’s time. The chemical companies are careful not to upset the masses by pushing toxins that are too overtly lethal because those get forced off the market. Best to stay under the radar and let the PR guys work the public.
Respected researchers have warned that a majority of children will be autistic in only a few years due to commercial poisons. Others know that in a generation or two cancers will be the leading causes of death, although very large numbers will probably die off from other man-made causes before it gets to that point, so cancers should get a pass.
It’s little wonder that some people will smugly remind you that they voted for the meteor, which is still very possible if it’s not too tardy. People who study such things know that catastrophic events are really fairly common. It’s two minutes to midnight, and winter is here.
Good to see Wolf weighing in in a unbiased manner.
Glyphosate has been examined for 30+ years without a definitive statement of causation by any credible organization. However, I’m ok with dead-enders continuing the search as long as the science is credible.
Lots of chemicals used the wrong way can kill a human. Don’t believe it? Drinking 6-8 liters in 2 hours killed a 29-year-old woman competing in a radio water drinking contest (http://abcnews.go.com/GMA/jury-rules-radio-station-jennifer-strange-water-drinking/story?id=8970712).
There are an estimated quarter of a million wild bee species keeping the flowering plants alive. The imposition of uniformity on ecosystems that only exist in a timeframe of long evolved diversity by the use of chemical and genetic manipulation can only be disaster.
A mind blower is the trucking in of bee hives to pollinate California’s almond fields. These mono-cultures are many square miles in size. Bees couldn’t live there all summer cuz there is only a 2 week flowering and only one type: almond.
Then all the (rented) hives get trucked back, some across US.
Hives are getting so valuable they are stolen.
Simple solution is buy Organic or if not then Non-GMO at least. even if eat Organic the spray on a neighboring GMO farm can hit the Organic farm. And glyphosate is in the water cycle too.
I know dozens of farmers. Corn, vegetables. apples (which require the most pestiside) I’ve never met a single one with cancer. In fact, one of our biggest farmers just died. he was 92.
The only farm worker i knew with cancer had throat cancer from chain smoking. The biggest problem with farms is cow shit. The ecoli gets in the water table.
Pesticides have 48 hour useful lives. Then they’re inert. Organic food uses organic pesticide. It’s just as toxic. In the end a dead bug is a dead bug
BTW, THC the active ingredient in pot is a pesticide. The same people who scrub apples, that were inert a month before their apples were even picked, smoke pesticides where they go directly into their blood stream. People complain about round up on corn. WHY ARE PEOPLE EATING CORN? It’s not digestible. Furthermore, it’s been cross bred to the point that it tastes like candy.
This is the problem farmers have. If they grow nutritious food, nobody buys it. The US has 90 million acres of corn, 45 million acres of wheat, 30 million acres of soubeansand 1.5 million acres of vegetables. My d
ata base for Buffalo has about 800 restaurants. 8)% of the sales are places with drive through windows.
That’s 80%. typo
Here’s something you might be interested in. There’s a lot of other stuff out there too. You find it if you look…
“Monsanto Faces Hundreds of New Cancer Lawsuits as Debate Over Glyphosate Rages On”
THC is a pesticide. Could you provide a source of reference for that.
THC supplies the psycho active effect (high) of marijuana, but it has another active ingredient called cannabidiol (CBD) that provides numerous medical benefits (seizures, nausea, glaucoma) without the high.
Hard to buy organic when wages never go up.
Well he said “simple solution” was buy organic like it was no big deal for everyone lol.
What you eat and how much you eat helps determine your health issues. It is not only your genes (DNA). I think eating three meals a day is more about food profits than health and body maintenance, especially since there are an abundance of diet books.
Where are the “organic police” to insure the claims made are true? I have yet to see some ongoing media blitz on this topic, but maybe they are too busy with other important topics. Will chickens grown inside and without exercise produce healthy food?
The scientific food supply is geared more toward longer shelf life than health of the body. We have as many protein and power bars now as cereals. All to eat on the go or to provide that needed energy boost. Where are the phyto compounds in these foods?
We must move towards eating the most natural foods we can and keep our Gastro-Intestinal tract as healthy as possible. Read all you can about your GI tract because if your are not breaking down and absorbing the nutrients from food, it will not matter what goes past that tongue. Be careful of those educating you and trying to sell you a product at the same time. Conflict of interest?
And finally remember the body changes slowly over time. That is why chronic diseases take time to develope. It is only drugs which make you think the body changes faster. But also remember those drugs are organic compounds, so it should make you wonder about eating “organic”.
Whole food plant based is the holy grail.
I wouldn’t eat a piece of meat grown in today’s factory farms if my life depended on it.
I value myself and my body too much.
I also fast every month to give my second brain (gi tract) a much needed rest. Autophagy is the other holy grail.
Why not eat grass fed beef that is pastured instead? You could even go further and find beef that was raised using regenerative techniques that builds soil health and sequesters carbon into the ground.
Don Q great article The food system that many of us are dependent on is extremely fragile. But I will argue that the headline may be a bit misleading. As I remember the majority of the world is not fed by big ag but instead by what can be termed subsistence agriculture, And I assume most of that seed is never registered even though much of it will trade hands or be bought and sold on a local level.
Is it that Bayer & Monsanto are in financial difficulty:
And therefore – a merger is the only way for them to survive.
If this is the case …..
What went wrong?
Is the customer base walking away from mainstream chemical based food supply?
We also need to remember that below replacement fertility has a firm grip on planet Earth’s reproductive capacity.
That the population of the planet is not at the reported 9.5 billion but ever decreasing.
Entrenched Denial: is holding the world in a state of suspended animation & potential shutdown.
From 1993 until 2010, my family had a wheat seed breeding/genetics company in Minneapolis that focused on hard red spring wheat for the northern plains which we sold to Limagrain Cereal Seeds. We competed against Monsanto owned WestBred, Syngenta owned AgriPro and also the U of MN, NDSU and SDSU. Bayer Crop Science was getting started in the U S wheat market at that time and they inquired about our program, but my Dad preferred LCS which began as a farmer’s coop in France.
The land-grant Universities also produce competitive varieties in most crops, and many wheat farmers in North Dakota, for example, are very loyal to NDSU, and all things being equal, will chose to plant their varieties over those of Big Ag’s.
One thing Bayer has done with their money is donate a million bucks or more to University breeding programs in order to gain access to the genetics.
General thinking is most chronic diseases are genetic. We are now finding out almost all of them are not genetic but rather caused by lifestyle and diet over the course of your life.
Studies continue to show a whole foods plant based diet is the best diet to minimize your risk of almost all diseases including cancer, heart disease, diabetes, dementia, Alzheimer’s, etc.
What we eat is either contributing to or fighting disease.
As per cancer rates for farmers
Farmers have high rates of Parkinson’s Linked to the use of pesticides. Our farmer’s son was born with developmental problems and penile Malformation linked to the use of atrazine that our farmer brought into his home, dusted on his clothes to his pregnant wife to wash.
Penile malformations have spiked in the last two to three decades. Plus the plunging Sperm counts in western and first world countries.
Read the book, Our Stolen Future
DDT linked to breast cancer Yes the tag line “better living through Chemistry “